282. The

panic of 1837

The election of 1836 was practically settled beforehand by Jackson, who selected Van Buren, required the Democratic convention to nominate him, and by his own popularity pulled his candidate through. The opposition was too discouraged to make a party nomination, and Van Buren got 170 electoral votes to 124 scattered votes. No sooner had Van Buren taken office in March, 1837, than a financial panic was ready to break upon the country—the worst that the United States has ever seen. The principal causes of this calamity are the following:

(1) Much banking business was carried on imprudently, partly because of the accumulation of government balances in the "pet banks" which were selected in 1833 to receive the public deposits. Depreciated state bank notes crowded specie out of use, and an act was passed (June 28, 1834) changing the ratio between gold and silver (§ 196) to 16 to 1, so as to encourage the use of gold.

(2) Lively speculation caused prices of cotton and other exports to rise, so that everybody seemed to be growing rich. The states found that they could borrow abroad, and ran up debts amounting to about $170,000,000.

(3) Lively speculation in western land was backed up by the "pet banks" and their neighbors. Jackson became alarmed, and suddenly issued the Specie Circular (July 11, 1836), an order directing that nothing but gold and silver should be received for the public lands.

(4) In 1835 the national debt was extinguished, and a surplus began to run up To get rid of it, in June, 1836, Congress passed a statute the so-called "Deposit Act"-for depositing with the states (really for giving away) about $36,000,000.

The call on the banks for the government deposits precipitated a crash. In May, 1837, all the banks of the country suspended specie payments; and nine tenths of the men in

business in 1836 were bankrupt in 1837. Many of the states, for the time being, defaulted on the interest on their bonds; three states repudiated principal and interest, and the money loss to their creditors was about $20,000,000.

283. Van Buren's quiet administra

The "pet banks" eventually turned over to the government $28,000,000 of public funds under the Deposit Act, and it was duly transferred to the states. Some of the states spent the money on canals, some to pay old debts, some for education, and a few states simply divided it among the voters. Slowly the country struggled up again; though in a second and lighter crash (1839) the old United States Bank went completely to ruin. Some of the states, especially New York, took the lesson to heart, and passed new banking laws, under which the state banks were required to protect their

notes.

tion (1837-1841)

A notable act of Congress during Van Buren's administration was a statute of 1840 for an independent treasury, or subtreasury, as it was often called, requiring the Treasury Department to keep its balances in its own vaults. Another important measure was the Preëmption Act of 1841, by which any citizen of the United States was to be allowed once in his life to buy 160 acres of arable government land.

mary

The twelve years of Jackson's influence (for Van Buren's administration is only a kind of extension of Jackson's) were marked by great activity in public life. President Jack- 284. Sumson sincerely believed that the federal government had given as much aid to individuals and states as was safe, and that it would be better to let the states develop themselves. Hence ho never showed any enthusiasm over the tariff; he vetoed internal improvement bills right and left; and he attacked the United States Bank just as he used to assault an Indian fort; he vetoed the Land Distribution Bill, and reluctantly approved the Deposit Act.

HART'S AMER. HIST.- - 20

The most serious discussions of this period were on sectional questions. The tariff was upheld by eastern, middle, and western states, and condemned by the South. Internal improvements most interested the western states, because they needed highways to reach their market. The bank question

was at bottom an issue between the eastern believers in incorporated capital and the western advocates of individual action. Public land questions usually aroused West against East. The South usually held together on sectional questions, although in the nullification issue the other southern states refused to back up South Carolina.

The real force and public spirit of Andrew Jackson was shown by the final results of his eight years in office. He revived Jefferson's principles of strict construction and of as little government as possible; he hammered out in conflict with Congress a set of new principles, low tariff, no United States Bank, no federal internal improvements, which served the Democratic party for more than fifty years thereafter; and he caused his opponents definitely to take up the old Federalist principles of loose construction.

Suggestive topics

Search topics

TOPICS

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(1) Why were some qualifications of voters and office holders removed? (2) Why was it difficult to frame good city governments? (3) Was the United States Bank dangerous to the country? (4) How came Webster to attack Hayne in the Senate? (5) Why did Jackson oppose nullification? (6) Why did Clay favor the Compromise of 1833? (7) Why did Calhoun change his mind on national powers? (8) Why have most of the canals been given up? (9) Why did Jackson oppose internal improvements? (10) Why did Jackson wish to annex Texas? (11) Did Jackson introduce the Spoils system? (12) Had Georgia a right to the Creek and Cherokee lands?

(13) Removals of federal officers for political reasons before 1830. (14) Removals for political reasons in New York before 1830. (15) Major Jack Downing's opinions of Jackson. (16) Jackson's intimate friends. (17) Jackson's enemies. (18) Popular

opinion of the Kitchen Cabinet. (19) Some of Jackson's removals from office. (20) Calhoun's doctrine of the compact. (21) Webster's theory of the origin of the Constitution. (22) First anthracite and bituminous coal furnaces. (23) Ride on an early railroad. (24) Reasons for the Independent Treasury plan. (25) City population in 1790 compared with that in 1840. (26) State railroads in Massachusetts, or Pennsylvania, or Georgia, or Michigan.

REFERENCES

See maps, pp. 324, 325, 330, 331; Semple, Geographic Condi- Geography tions, 168–176; MacDonald, Jacksonian Democracy.

Wilson, Division and Reunion, §§ 7, 12-24, 28-52, 57, 58, 71; Secondary Channing, United States, 212-224; Johnston, Politics, 109-139; authorities Stanwood, Presidency, 151-205; MacDonald, Jacksonian Democracy; Schouler, United States, III. 451-506, IV. 31-199, 229296, 316–352; McMaster, United States, V. 2–13, 121-168, 380394, 519-556; Peck, Jacksonian Epoch, 123-472; Dewey, Financial History, §§ 81-101; Houston, Nullification in South Carolina; Sato, Land Question, 151-168; Sparks, Expansion, 274-289, 310319,- Men who made the Nation, 273-281, 294-334; Sumner, Andrew Jackson, 176-460; Brown, Andrew Jackson, 118-156; Parton, General Jackson, 281-326; Shepard, Martin Van Buren, 176-397, 449-467; Schurz, Henry Clay, I. 312–384, II. 1–69, 129–152, 172-198; Lodge, Daniel Webster, 166-234; Holst, J. C. Calhoun, 83-120, 183-220; Roosevelt, T. H. Benton, 63-139, 151–209; Bruce, General Houston, 1-136; Trowbridge, S. F. B. Morse; Raymond, Peter Cooper, 1–51.

Hart, Source Book, § 102,- Contemporaries, III. §§ 158-168, Sources 185; MacDonald, Select Documents, nos. 46-68, American History Leaflets, nos. 24, 30; Old South Leaflets, nos. 106, 130; Ames, State Documents on Federal Relations, no. 4, pp. 32-60; Johnston, American Orations, I. 233-334, IV. 202–237. See N. Eng. Hist. Teachers' Ass'n, Syllabus, 345-348, Historical Sources, § 84.

works

A. E. Barr, Remember the Alamo; Kirk Munroe, With Crockett Illustrative and Bowie; C. A. Davis, Letters of J. Downing, Major (satire on Jackson); Simms, Richard Hurdis, Border Beagles (interior). Wilson, American People, IV.; Sparks, Expansion.

Pictures

CHAPTER XXII.

SOCIAL AND SECTIONAL CONDITIONS (1831-1841)

SIDE by side with the growth of democracy went a stronger feeling of public responsibility toward the poor, the weak, the friendless, and even the criminal. People began to see manitarian that brutality to prisoners begets brutality to free men, reform and that an object of punishment is to reform.

285. Hu

The

first modern prison was the Eastern Penitentiary at Philadelphia (finished just before 1830), where, in order to prevent one criminal from contaminating another, the prisoners were shut

up in separate cells. The poor debtor also enlisted the sympathy of the community, especially when an old Revolutionary soldier was found who had been in jail for seven years on a debt of less than five dollars. In the course of the twenties and thirties all the states and the federal government passed laws releasing debtors who had nothing with which to pay. Hospitals, clean and

well-kept poorhouses, orphan asylums, and institutions for the deaf, dumb, and blind, also began to spring up; and in 1841 came forward a great woman, Dorothea Dix, who made it the